Dollar Returns to Key Level but Risk Slide Looks More Convincing
• USDollar has dropped back to the same 12,150 level that took so long for bulls to clear
• Data and cross market performance suggest the USD slide is lacking for conviction
• Meanwhile, risk trends led by the S&P 500's impressive break below the 200-day SMA looks more intensive
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The positive correlation returns. Both the Dollar and S&P 500 dropped this past session, but only one of these benchmarks carries the hallmarks of conviction to convince of follow through. From the Greenback indexes - both USDollar and DXY - the retreat is impressive technically; but the scope of the move lacks. EURUSD and AUDUSD were the most convincing anti-USD moves, but that was a reflection of strong (likely temporarily) counterparts. Across the market, the currency was mixed on a day of light but encouraging fundamental event risk. That draws the focus back to the 12,150 level that was critical resistance for 2015 until last Friday. Meanwhile, the S&P 500's slide below its 200-day moving average finds the push of hefty selling pressure in other assets that are typically attributed a 'risk' bearing. We consider this key moves and what it means for trading potential in today's Trading Video.
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.